ENANTA PHARMACEUTICALS INC Q3 FY2022 earnings call

• EDP-235 Phase I results: Safe and well-tolerated in healthy volunteers, with favorable PK profile. Projected to have high drug levels in lung tissue. Plan to finalize Phase II protocol and initiate study in Q4 2022.
• RSV program: Advancing EDP-938 and EDP-323. EDP-938 has fast track designation; ongoing studies in pediatric and high-risk adult populations. Plan to start Phase II RSV study in high-risk adults and Phase I for EDP-323 in Q4 2022.
• Hepatitis B: Committed to developing combination regimen with EDP-514, a HBV core inhibitor with Fast Track designation.
• Patent litigation: Seeking damages for Pfizer's infringement of Enanta's 953 patent, but not intending to impede paxlovid's distribution.
• New CMO: Welcome Dr. Scott Rottinghaus, who joins to advance antiviral development programs.
• Near-term milestones: Advance COVID-19 program to Phase II in Q4 2022, start new Phase II RSV study in high-risk adults, initiate Phase I for EDP-323, and nominate clinical candidate for hMPV in H1 2023.

For the third quarter ended June 30, 2022, total revenue was $19.5 million, consisting of royalty revenue from AbbVie's MAVIRET. This is down from $21.6 million in the same period of 2021. Research and development expenses were $39.1 million for the quarter, compared to $47 million in 2021. General and administrative expenses were $12.9 million, up from $8.4 million in 2021. Net loss was $31.7 million, or $1.53 per diluted common share, compared to a net loss of $24 million, or $1.19 per diluted common share in 2021. Enanta ended the quarter with approximately $292.7 million in cash and marketable securities.

• Enanta expects current cash, cash equivalents, and marketable securities, along with ongoing royalty revenue, to be sufficient to meet cash requirements for existing business and development programs for the next 2 years.
• Plan to finalize Phase II protocol for EDP-235 and initiate the study in Q4 2022.
• On track to begin a new Phase II RSV study in high-risk adults in Q4 2022.
• Plan to initiate Phase I study for EDP-323 in Q4 2022 and nominate clinical candidate for hMPV in H1 2023.

• Patent litigation with Pfizer regarding infringement of Enanta's 953 patent for paxlovid. However, Enanta does not intend to seek an injunction or impede paxlovid's production, sale, or distribution.

Q: Could you talk about the potential for an accelerated path to approval with COVID antivirals? And secondly, current thoughts on Phase II design in terms of patient population and endpoints? Given lower event rates with Omicron, how do you think about trial design, size, powering, and accrual times? When can we expect EDP-235 to enter the market?

A: Jay Luly mentioned that antiviral development is different from vaccines and antibodies, and there's no same short path for acceleration. They're in the process of designing Phase II with FDA interactions, plan to finalize and start Phase II in Q4 2022. Timing for market entry depends on trial progress.

Q: The 4:1 lung-to-plasma ratio for total drug, is that using total amount of drug in plasma? Or just free nonprotein bound drug? And in the IS-IRV poster, was EC90 corrected for serum protein binding?

A: Jay Luly stated the 4:1 ratio was using total drug in plasma, and the EC90 in the poster was not plasma adjusted.

Q: Thoughts on paxlovid rebound? Is it a PK issue, not enough coverage, 5 days not enough, or resistance? How does EDP-235 mitigate this?

A: Jay Luly said it doesn't appear to be a resistance issue. Paxlovid has a short half-life, while EDP-235 has good PK characteristics, longer half-life, good tissue partitioning, which may help mitigate rebound.

Q: Any alternative mechanisms in COVID-19 viral life cycle to target with EDP-235? Thoughts on viral induction and utility of viral load as a registrational endpoint?

A: Jay Luly mentioned Enanta is looking at other mechanisms in-house, but no immediate need for combination. Viral load reduction is modest, and not the only endpoint that matters.

Q: Potential for EUA filing for EDP-235? Thoughts on RSV infection rates in Northern and Southern Hemisphere and enrollment monitoring?

A: Jay Luly said EUA availability depends on facts on the ground, and RSV infection rates in Northern Hemisphere are expected to perk up in late Q4.

Q: Color on COVID-19 discovery programs, specificity/potency against emerging variants, and need for combining EDP-235 with another mechanism?

A: Jay Luly said no immediate need for combination now, but Enanta will continue researching other mechanisms in case needed for future variants.

Q: Potential cost for EDP-235 trials? Percentage of patients reaching EC90 in Phase I study? PK variability across patients?

A: Tara Kieffer said cost depends on trial sizing, Phase I study had low PK variability (15%), expecting >95% of patients above EC90 value down the road